proposed steps which were outlined by the company's witness for the elimination of The United Light and Power Company only as evidence bearing upon the question of which company should be eliminated. It is unnecessary for us to pass upon the various proposed steps to accomplish this result since it is enough for present purposes that action must be taken to comply with the "great-grandfather" clause. It appears, however, that the steps described by Mr. Munsell to effect the dissolution of The United Light and Power Company are such that in broad outline they are consistent with the statute; this in itself is persuasive evidence that The United Light and Power Company is the company to be dissolved for the purpose of compliance with that clause. REMAINING ISSUES The first sentence of Section 11 (b) (2) requires the Commission to direct each registered holding company and its subsidiaries to take such steps as may be necessary for eliminating undue and unnecessary complications in corporate structure and for distributing voting power fairly and equitably among security holders of a holding company system. The second sentence of the section, while it contains a specific mandatory provision with respect to eliminating all companies in excess of three tiers, is in our view not a limitation of the more general provision contained in the first sentence. It is a minimum criterion for simplification. Even though a holding company system may comply with the requirements of the second sentence, it must still take further action if the corporate structure is such as to include any undue or unnecessary complexities or if there exists unfair or inequitable distribution of voting power.16 CONCLUSIONS Under the circumstances of this case and on the record presented, we find that the liquidation and dissolution of The United Light and Power Company and United American Company are steps necessary to comply with the requirements of the statute. Accordingly, we conclude that an order should be entered at this time directing the liquidation and dissolution of these two companies. Our order will provide that the respondents shall proceed with due diligence to bring about the liquidation and dissolution of The United Light and Power Company and of United American Company, and that they shall make application to the Commission for the entry of such further orders as may be necessary or appropriate for that purpose; the order will 16 In his testimony Mr. Munsell recognized that there were other problems existing under Section 11 (b) (2). The issues presented by Section 11 (b) (1) as applied to this system are pending in a separate proceeding. (United Light and Power Company, File No. 59-11; see Holding Company Act Release No. 1961.) reserve jurisdiction to enter such further orders in this proceeding as may be necessary or appropriate for that purpose. Our order will also provide that the hearing shall be adjourned, subject to call upon such notice as the Commission shall deem appropriate, for the purpose of considering other issues presented under Section 11 (b) (2) and particularly to determine what other steps should be taken, by way of elimination of additional holding companies or otherwise, to bring about compliance with the requirements of Section 11 (b) (2) not disposed of by our present order. By the Commission: (Chairman Frank and Commissioners Healy, Eicher and Pike) Commissioner Henderson being absent and not participating. 8 S. E. C. |